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Survey: Distributors a Bit More Optimistic (Part 1)

Paul Partyka |

CHICAGO — In some ways, this distributor survey had a lot in common with last year’s survey. Maybe I’m a glass-half-full guy, but a couple of positive things jumped out at me this year. First, it was interesting to see how some of the distributors were utilizing “better” locations — locations that became available because landlords were unable to fill them due to a slow economy.I was also encouraged to see the distributors a bit more optimistic about this year’s sales forecast as compared to the 2009 sales forecast (For details, see Part 2 of this story on Wednesday, Sept. 1).Every distributor on American Coin-Op’s mailing list was invited to participate in the unscientific survey.2009 BUSINESSLast year was a struggle for distributors. Only 15.6 percent of respondents said business (sales of newly constructed stores and replacement business) was better in 2009 than 2008. Forty-nine percent said business was worse in 2009 than 2008, and 35.5 percent said business was comparable in both years.For those experiencing a decrease in business last year, the No. 1 reason, by far, was the economy. In addition, a large number of distributors also cited the lack of available financing as a major problem. A handful of distributors said business suffered because of an exodus of transitional workers, which meant less laundry business.For those with a business increase last year, the top two reasons cited were offering new equipment (with rebates, in some cases) and an improved sales effort. One distributor said his “reputation” allowed him to avoid a down year.REPLACEMENT BUSINESSReplacement-business figures mirrored the overall business results. In replacement business only, 49 percent said business was down last year compared to 2008. Twenty percent saw a rise in replacement business, and business stayed the same for 31 percent of respondents.The figures in this category have fluctuated a bit in the last several surveys. In last year’s survey, 40 percent of respondents saw replacement business rise, and only 29 percent saw business dip.NEW-LAUNDRY CONSTRUCTIONDistributors were asked how many new laundries they built and/or to whom they supplied equipment in 2009. Sixty-two percent of respondents built or supplied equipment to three or fewer new laundries. In last year’s survey, this figure was 42 percent.How many new laundries are distributors dealing with in some fashion? Here are the most popular answers: 

1) 32) 03) 24) 15) 6

Distributors were also asked if their 2009 new-construction total was more, less or the same when compared to 2008. Fourteen percent said new construction was up in 2009, 52.3 percent said new construction was down, and 33.7 percent said new construction was the same in 2009 and 2008.THE RIGHT MIX?Deciding how much equipment to put into a new store is a crucial decision. Operators want to generate revenue, yet they don’t want an overcrowded store. When it comes to filling a new store, the issue of top loaders also surfaces. Are owners passing on top loaders? If you’re thinking about adding a new store, or wondering what that new store down the street is going to offer, take a look at what distributors are installing throughout the country...Please return for Part 2 of this story on Wednesday, Sept. 1. 

About the author

Paul Partyka

American Coin-Op

Paul Partyka was editor of American Coin-Op from 1997 through May 2011.

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